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A home for sale sign hangs in front of a house in Oakton, on the day the National Association of Realtors issues its Pending Home Sales for February report, in Virginia March 27, 2014. REUTERS/Larry Downing Acquire Licensing Rights
Oct 17 (Reuters) – A trial is kicking off this week against the National Association of Realtors and several real estate companies that are accused of working together to artificially fix the commissions that home sellers pay to buyers’ agents.
Home sellers are seeking more than $1.3 billion in damages in the Kansas City, Missouri, federal court class action over the industry’s “buyer broker” commission rule. The defendants also include Keller Williams, HomeServices of America and two of its subsidiaries.
The antitrust case is widely seen as having potential to upend long-established residential real estate practices. Opening statements began on Tuesday in a trial that is scheduled to run until Nov. 3 before U.S. District Judge Stephen Bough.
“Let people pay the agents who work for them — and stop making homeowners pay a buyer’s agent,” lead class attorney Michael Ketchmark told Reuters. Ketchmark said the case challenges the “grip of corporate control” over residential real estate.
The class members include sellers of more than 260,000 homes in Missouri and parts of Kansas and Illinois between 2015 and 2012.
Chicago-based National Association of Realtors, Keller Williams and HomeServices have denied the allegations.
A spokesperson for Keller Williams declined to comment, and the real estate association had no immediate comment. HomeServices did not immediately respond to a request for comment.
In a court filing, lawyers for the National Association of Realtors argued that the market itself “decides how real estate agents’ services are given and paid for.”
Katie Johnson, chief legal officer of National Association of Realtors, said in a podcast posted on Monday that “we’re going to show that the rule makes sense and that it’s lawful.”
Two other defendants in the case, Re/Max and Anywhere Real Estate, recently said they would settle claims. Anywhere planned to pay $83.5 million, and Re/Max said it would pay $55 million. Both settlements are pending court approval.
Re/Max and Anywhere denied the plaintiffs’ claims but settled to avoid the uncertainty of litigation.
The case is Burnett et al v. The National Association of Realtors et al, U.S. District Court for the Western District of Missouri, No. 4:19-cv-00332-SRB.
For plaintiffs: Michael Ketchmark of Ketchmark & McCreight; Eric Dirks of Williams Dirks Dameron; and Brandon Boulware of Boulware Law
For The National Association of Realtors: Ethan Glass of Cooley
For HomeServices and affiliates: Robert MacGill of MacGill PC; Jay Varon of Foley & Lardner; and Brian Fries of Lathrop GPM
For Keller Williams: David Kully of Holland & Knight
Read more:
US Justice Dept steps into real estate commission case to question merits of antitrust deal
Probe of National Association of Realtors needs reviving, US Justice Dept argues
U.S. real estate brokerages must face home sellers’ class action over commissions
Reporting by Mike Scarcella
Our Standards: The Thomson Reuters Trust Principles.
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